Answer:
Why can't the Fed push the rate any lower than zero?
Real interest rates can be lower than zero, or negative (because inflation rate is higher than interest rate), but nominal interest rates are generally only limited to zero. But during this same time, the European Central Bank actually started paying negative interest rates on money deposits and many European private banks followed. That means that they charged people for having their money on the bank.
Why do you think that the Fed was so seemingly reluctant to push the rate all the way to the floor?
The reason why the Fed was not willing to push the interest rates to zero or even below zero was that by doing so, the US dollar would have depreciated or lost value. In Europe this was done to encourage people to spend their money and not save as much, but in the US that is not really a problem. Generally in the US the problem is that people spend too much and save too little, but on some European countries and Japan, people tend to save too much. For example in Japan the national savings rate fluctuates between 22-40%, while the maximum savings rate in the US has been 10.4% in 1960, it currently is around 7.6%.
Answer:
The company's degree of operating leverage is closest to $840000
Explanation:
Selling price per unit = Sales revenue / No. of bags sold
= $1560000/200000 bags = $7.8 per bag
Variable cost per unit=Total variable expenses/No. of units
= $840000/200000 units = $4.2 per bag
Company’s unit contribution margin = Selling price per unit-Variable cost per unit
= $7.8 per unit-$4.2 per unit = $3.6 per unit
Company's degree of operating leverage = Variables manufacturing expense + Variable selling and administrative expense
=$660000+$180000 = $840000
A firm that produces units of output using capital and labor to determine its total costs will decline by doing so, the firm will evaluate its:<u> Marginal cost Function .</u>
<u></u>
Option C is correct .
Marginal cost is the change in cost due to producing on excess unit of affair. To determine how big its total cost decline, the establishment will estimate its marginal cost function.
<h3>
Marginal cost function :</h3>
Marginal cost represents the gradual costs incurred when producing fresh units of a good or service. It's figured by taking the total change in the cost of producing further goods and dividing that by the change in the number of goods produced.Marginal cost is calculated as the aggregate charges needed to manufacture one fresh good. thus, it can be measured by changes to what charges are incurred for any given fresh unit.<u> Marginal Cost</u><u> = Change in</u><u> Total Charges ÷</u><u> Change in volume of Units Produced.</u>
Question is incomplete ,missing option is given below :
Consider a firm that produces units of output using capital and labor. Due to changes in market conditions, it has decided to reduce its daily output from 5 units to 4 units. To determine how much its total costs will decline by doing so, the firm will evaluate its: Group of answer choices
A.marginal product function
B.average product function
C.marginal cost function
D.average total cost function
E.average variable cost function
Learn more about Marginal cost function :
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Answer:
Private Savings + (Imports – Exports) = Investment + (Government Spending – Tax)
Explanation:
This relationship expressed in the equation above is a macro economy equation which is correct and implies that the quantity supplied of financial capital is equal to the quantity demanded of financial capital.
Supply of financial capital is represented by "Private Savings + (Imports – Exports)", while the demand for financial capital is represented by "Investment + (Government Spending – Tax)".
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